Equilibria: Unleashing the potential of Pendle and exploring a new engine for interest rate swaps.

Original title: "Understanding Equilibria in 3 Minutes: Pendle and the New Growth Engine and Era of Interest Rate Swaps"

Source: CapitalismLab

After achieving a tenfold increase in TVL/price, Pendle is about to experience exponential growth. As a token that utilizes ve-tokenomics, it lacks a Convex to fully realize its potential. Equilibria is a project designed for this purpose, and this thread will analyze its mechanism and value for Pendle and the interest rate swap track.

vePendle enjoys the following rights:

投票决定激励分配 Boost PT/SY pool 的收益，参见下图 3% 的 YT 利息收益 80% 的 AMM Swap Fee
Translation:

Voting determines the distribution of incentives for Boost PT/SY pool earnings. See the chart below for 3% YT interest earnings and 80% AMM Swap Fee.

These rights are not inferior to the current benchmark veCRV and have high value.

The two-year maximum lock-up period has brought some liquidity problems to it. Therefore, Equilibria is very similar to Convex. It also locks vePendle perpetual to ePendle Token for users to help Pendle's AMM LP Boost income, and then shares a portion of the Boost income with ePendle and vlEQB. vlEQB will enjoy the bribery income it receives.

Pendle has gained momentum recently, partly due to the updates brought by V2's mechanism and largely thanks to the rise of LSD and derivatives, which provide a stable source of long-term returns for Pendle.

However, there is still untapped potential in Pendle, specifically in its potential for bribes. Professional organizations hold a large share in LSD and have a strong demand for regularity. Therefore, in theory, there is also room for LSD protocol to come to Pendle for bribes to meet the needs of these organizations.

LSD incentivizes cake splitting, I wonder how much Pendle can get with Equilibria's support.

Although Pendle is a two-year-old project, currently only 30M out of the 150M Pendle in circulation is locked, leaving 120M in circulation, which also leaves some room for Equilibria's initial growth.

Equilibria recently announced that it will launch a launch event in May, airdropping 2% of the total $EQB tokens based on the amount of Pendle stored by users. It is estimated that a large amount of Pendle still in circulation will be locked up, and with Pendle's core team members also being one of its multi-signature managers, it is expected that a significant amount of Pendle held by the treasury and the team will also flow in. The overall lock-up ratio of Pendle is expected to further increase.

In addition, Pendle's Tokenomics has planned to implement perpetual 2% incentive inflation after the rapid inflation period ends in 2026. This means that vePendle/vlEQB will have the opportunity to continue benefiting from bribe revenue.

Since ePendle and vlEQB are also yield-generating assets, theoretically speaking, they can also be combined with Pendle to build their own YT/PT, in order to achieve fixed interest rates, better serve institutions, and further support the Pendle ecosystem, achieving a flywheel growth of TVL. Even after Equilibria has paved the way, other ve-token wrappers may also learn from and join the Pendle ecosystem, helping Pendle expand into new markets.

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